Property prices down 40 per cent

Property prices in WA have fallen while unemployment and cost of living expenses are high. It’s a perfect storm for those who invested at the height of the mining boom. Courtesy: ABC/7:30

People in WA struggling with mortgages and collapsing housing prices. Picture: iStock

FAMILIES in Western Australia are at breaking point, plagued with mounting debts they can’t pay off, as they face the reality of a collapsing economy.

As properties decrease significantly in value and unemployment rates rise, many are now struggling to find jobs to make ends meet.

Could this be the future of Melbourne and Sydney? Western Australia was once a booming product resources hub, with thousands moving to areas around Perth from interstate and overseas to work.

It had one of the strongest economies in the nation with housing prices on par and even higher than Sydney and Melbourne in the early 2000s.

Fastforward to 2017 and WA now has the weakest economy in the country, with a high unemployment rate and a collapsing property market.

Perth property valuer Gavin Hegney told ABC’s 7.30 program homes at the top end of Perth and on the urban fringe were decreasing in value and lessons could be learned from WA’s collapse.

“Perth was booming, booming along and the east coast was on its knees,” he said.

“It’s the complete reverse today.”

Mr Hegney told ABC WA had a strong economy in 2006 and 2007 but today it was a completely different story. And he warned it would be a risky move for the government to change laws around negative gearing and capital gains tax.

“You probably want to be planning policies now for when the market comes off, and it will come off. What policies then should we implement to soften the blow of the market?” he said.

“That’s what we should be thinking today, not turning off the top of our boom.”